US ahead of Europe on energy policy

Source: Financial Times

Europe’s manufacturers are rapidly losing ground to US rivals because of soaring energy costs and the failure of the continent’s governments to be “rational” about nuclear power and shale gas, the head of one of the world’s biggest chemicals groups has warned.

In an interview with the Financial Times, Jean-Pierre Clamadieu, the new chief executive of Franco-Belgian Solvay, accused Germany, France and Belgium of acting in isolation on nuclear and gas policy and failing to come up with a coherent strategy to keep Europe’s companies competitive.

“There is very little European co-ordination,” he said, warning that energy costs should be ranked alongside the eurozone crisis as the most urgent problem confronting industry.

Natural gas in the US is three times cheaper than in Europe because of its decision to exploit shale gas through the environmentally-controversial process of “fracking” – the high-pressure injection of water and chemicals to free up trapped gas.

4. "the head of one of the world’s biggest chemicals groups has warned"

This is just a hit piece on Europe's environmental policies by an industry trade group. This clown is excoriating "Europe" because it hasn't joined the race to the bottom with fracking like the US has. I guess a bag of cash doesn't buy the same favors there as it does in Washington.

Let me quote a paragraph:
The best-developed shale gas basin is Barnett in Texas, responsible for 70% of all shale gas produced to date. By “developed” I mean drilled and drilled and drilled, and then drilled some more: just in 2006 there were about as many wells drilled into Barnett shale as are currently producing in all of Russia. This is because the average Barnett well yields only around 6.35 million m3 of gas, over its entire lifetime, which corresponds to the average monthly yield of a typical Russian well that continues to produce over a 15-20 year period, meaning that the yield of a typical shale gas well is at least 200 times smaller. This hectic activity cannot stop once a well has been drilled: in order to continue yielding even these meager quantities, the wells have to be regularly subjected to hydraulic fracturing, or “fracked”: to produce each thousand m3 of gas, 100 kg of sand and 2 tonnes of water, combined with a proprietary chemical cocktail, have to be pumped into the well at high pressure. Half the water comes back up and has to be processed to remove the chemicals. Yearly fracking requirements for the Barnett basin run around 7.1 million tonnes of sand and 47.2 million tonnes of water, but the real numbers are probably lower, as many wells spend much of the time standing idle.

This rha rha natural gas site, even points out the rapid decline in production of these wells, 80% reduction in the first year:

ASPO (Association to study Peak Oil) has always maintained that given the nature of Natural gas (That oil is converted to Natural Gas whenever it drops below 20,000 feet) it is much harder to predict when Natural Gas will peak and decline. Unlike an oil well, which builds up slowly, then peaks and then go into a steady decline, Natural Gas wells produce at peak almost from the first day of production, continues that peak till it empties out. Thus Natural Gas wells can produce for years, then one day stop production. On the Marcellus Shale level it appears to be about a year between the start of production and the end of production. That is NOT a good sign but most people are ignoring that unpleasant idea, preferring the idea that all we have to do is drill more wells faster.
http://endofcrudeoil.blogspot.com/2012/02/shale-gas-development-in-united-states.html

Thus the more I get into Shale Natural Gas production, it appears to be a heavy short production life, and given that most wells are drilled where it is expected to have the most gas, sooner or later I see a decline as it gets harder to find new places to drill.